A New Idea of Public-Private Partnership

Veronica Vecchi has been Professor of Practice at SDA Bocconi for several weeks. She has already covered a significant part of her professional journey here with her research and teaching activity in the field of public management. In addition to that, she has a long-standing commitment to supporting public and private institutions to foster a new vision of partnerships and a new way of being a partner.

We could call you the knowledge leader of PPP: public-private partnerships. Can you briefly explain why they are so important? What has changed and what needs to change in this field?

I have been involved in PPP for 20 years, and they have always been the common thread in my research and educational work at Bocconi. So perhaps the answer is yes. During this period, I have tried to generate knowledge and encourage public institutions and economic actors, both in Italy and abroad, to develop a collaborative approach to addressing major economic and social challenges. Today, this vision is emerging strongly for the achievement of the global development macro goals, the SDGs. By now, all the stakeholders are aware of the importance of public-private collaboration at macro (policy), meso (institutional) and micro (project) levels. However, in order to ground real collaboration, we need managers, both in the public and private sectors, who share the same values as well as a useful skill set to generate shared value. My latest book, Public Private Collaboration. Converging toward public value generation, is the distillation of this vision and the result of ten years of study. The Masan Observatory on Healthcare Procurement and the InvestinIT Lab on Long-Term Investments, of which I am the scientific director, were formed with the goal of creating this convergence. I think SDA Bocconi has achieved a lot in this direction and with a unique approach that we need to take forward.

You have been and are committed, both nationally and internationally, to the issues of development and public investment. What do you see as the main urgencies on which it is important to focus, both in terms of substance and method?

The idea of partnership can be specifically adapted to public investment, mainly through the model of concessions. This model has been used for building and managing the economic infrastructure for decades and is a field where private investors and operators are largely present (think of the energy sector). However, these contractual models are complex, and have not produced the desired results when a strong regulator or public client was absent, or when contractual and financial mechanisms peculiar to the context or type of investment needed to be defined. This has resulted in profound distrust, which is difficult to overcome today. However, it would be wrong to throw away these schemes, as I recently wrote in a commentary for Public Works Policy and Management, a scientific American magazine. It is not the policy (i.e., the PPP) that is wrong, but the way contracts are structured and managed. Again, more skills and different awareness are needed when public and private want to work together. This is the only way we can structure new contracts to generate shared value. In the public sector there is often a great aversion to risk, and legal-administrative skills dominate, which makes it difficult to grasp the economic and financial nature of PPP contracts (the Italian Consiglio di Stato also mentioned this!).

You have been the president of the Milano-Cortina Infrastructure Company (SIMICO) since 2021: What challenges does 2026 pose to Italy? Challenges that intersect the timeframe to implement the PNRR.

The 2026 Olympics are a great challenge not only in terms of organizing the event but also because these Olympics will have to be sustainable. Looking at the Games from SIMICO’s perspective, we have a great opportunity while implementing the investments under our purview and monitoring the overall investment plan, which is internalizing sustainability logics. This is ideal for me. I am working with Managing Director and Commissioner Luigi Sant’Andrea (an alumnus of our EMMAP master’s program) and some very talented executives in the company, to develop a value-based procurement process framework that will allow us to embed societal values (financial, social, environmental and economic) into tender models, so as to foster a greater convergence of the economic players on sustainable development objectives. This should push the Investment Plan’s value-generation capacity to a maximum. We will measure this through our Value for Society framework, which is the result of research conducted with my team here at SDA Bocconi over the last few years. I believe these logics can be replicated on a national and international scale. This would be a great achievement and I like to think that SIMICO’s purpose is also to be a “sophisticated client” (to use one of the expressions I am fond of) and develop new procurement models that are more strategic and able to achieve the value outlined by policies. That is why I like to think of this project as an intangible legacy of the Olympic Games, which can also stimulate a different attitude in the implementation of the PNRR investments. The time pressure should not make us lose sight of the quality of investment, for society. The right skills at play can really make a difference.

SDA Bocconi School of Management